All Texans are responsible for paying use tax when they buy taxable goods and services for use in Texas and the seller does not charge Texas sales tax, or does not charge the correct amount of Texas sales tax. Use tax is reported and paid directly to the Texas Comptroller's office.
Making purchases by telephone, email, or fax from mail order catalogues and websites are typical situations of when Texas use is due. For example, if you buy a shirt through an online auction from a seller in Ohio who does not charge you sales tax, or a New York electronics store sells you a camera through its website and does not charge you sales tax, you owe Texas use tax.
Items bought in another country are also subject to Texas use tax. For example, if you buy something in Mexico that you bring back to Texas, you owe use tax on the purchase price.
Furthermore, assume you live in Houston and buy an item for $200 from a seller in a part of Texas with no local taxes. The seller only charges state sales tax of $12.50, or 6.25 percent. Since the correct tax rate in Houston is 8.25 percent, you owe additional use tax of $4.00.
Credit for Tax Already Paid
Texas allows a credit for sales or use tax paid to other states. For more information about whether the credit applies to your situation and how much credit to claim, please call 1-800-252-5555.
Need Assistance Determining the Sales Tax Rate?
Use our Sales Tax Rate Search system to view rate information for the different city taxing jurisdictions if a location is within city limits. For all local tax rates in alphabetical order, see these links:
If you need assistance in determining the sales tax jurisdictions for a location, contact the County Tax Appraisal District or the sales tax jurisdiction representative.
Rate Details and Other Information
If you have a Texas sales tax permit, you should file the use tax on your Texas Sales and Use Tax Return form in Item 3, Taxable Purchases. If you don't have a sales tax permit, you should report the use tax due on the Texas Use Tax form 01-156 (PDF, 53k). A non-permitted out-of-state company that uses form 01-156 should include its Texas address. If the out-of-state company does not have a Texas address, then the company should complete form AP-201 (PDF, 333k).
The state use tax rate is 6.25 percent. Depending on where you live or are located, you may owe up to an additional 2 percent in local use taxes.
If you have a Texas sales tax permit, file any use tax due on your next regularly scheduled payment date. If you don't have a Texas sales tax permit, the Texas Use Tax form is due no later than January 20 of the year following the year in which you bought the item, as long as the amount of tax to be paid on your untaxed purchases during a calendar year does not exceed $1,000. For example, if you buy just one item during the current calendar year that is subject to use tax on October 12, 2005, and owe $8.25 in use tax, you can file the Texas Use Tax form and pay tax any time through January 20 of the following year.